Comparing Double Wides To Single Wides For FHA Appraisal

[J Grant]

It says HUD has it as uninsured. Doesn't that just mean there is no FHA mortgage on it currently? It didn't say it was uninsurable.

Lot's a reasons HUD won't insure... having been moved from a different site is one.

HUD won't do a Title II on a MH in a rental park. But they might do a Title I on a MH in a rental park. Has to meet the requirements for a HUD home. And the loan only goes so high.

It's not a rental park- in fact there are no HOA fees . Anyway my spidey sense was u-... I have no idea what is going on there but the fact that no sales were financed means something- not sure what but often when I see that it is because for one reason or another the properties or project if a condo do not qualify for (most ) loans...some weird private loan maybe but this was for FHA. Other possibility is it is high land value there relative to these low quality small MH homes...maybe an investor is buying them up for cash ...a possiblity but this one sale is not cash so...will be someone else's problem

 

[CANative]

Aye yai yai.

It's as if I'm posting from a galaxy far, far away.

Have a nice holiday weekend.

 

[J Grant]

You too ! hope everyone has a fun and relaxing weekend

 

[Deleted member 128537]

So this past week I visited my sister in Arizona. She and her husband live in a manufactured home park (55+) with amenities like pool, rec room, golf course, etc. They don't own the land, but they do own the house. Most are double wides, some triple wides. They are not on a permanent foundation, although the attached garages are on slab. So I asked him how these things are sold. He said they are hard to get loans on, but not impossible. Most pay cash. The land rents can be locked in for up to 10 years. Then they can be renegotiated. There is no way these homes can be moved. Well I should say it would be really really hard, and frankly self-defeating. The nice existing ones sell for around 180,000 to 190,000. Some of the new spec ones going in are over 200,000. So really this is a leasehold estate from the perspective of those that own the buildings. It seems to me that the lessor has a good deal of leverage over the lessees. And according to the covenants anyone that buys a property has to renegotiate the lease structure. I'm thinking this is a way to make a lot of money for the one that has control of the leases. But the property taxes for my sister and brother-in-law are really low (like $500 a year). So maybe that's the draw for this kind of arrangement. I would have been interested in delving into this more, but no time. Really nothing like this in my part of the world.

 

[CANative]

So figure a two section at 1400 sf at $85/sf with bells and whistles and a $12,000 garage. That's $131k with no depreciation. "No land" but they sell for $180k to $200k.

IPLV or "Blue Sky Value." The combination of the expectation of permanence + park amenities = the value of the leasehold.

You don't have to own the land to get a value beyond replacement value, or consignment value, or other types of value. It is why we can appraise an MH on fee land even if there is no "permanent foundation" yet.

 

[Deleted member 128537]

So figure a two section at 1400 sf at $85/sf with bells and whistles and a $12,000 garage. That's $131k with no depreciation. "No land" but they sell for $180k to $200k.

IPLV or "Blue Sky Value." The combination of the expectation of permanence + park amenities = the value of the leasehold.

You don't have to own the land to get a value beyond replacement value, or consignment value, or other types of value. It is why we can appraise an MH on fee land even if there is no "permanent foundation" yet.

I agree you can appraise a MH without a permanent foundation. The problem is will the lender accept it.

Also the garage cost is more like $20,000. Thy are insulated, heated, etc. Most of the homes are about 1800sf. Also they are fitted with big porches and decks. And these manufactured homes are higher end. All drywall, all wood, better cabinets, better fixtures, wood siding, etc. These are not $85sf MH’s.

My brother-in-law said he would be lucky to get his cost on resale.

 

[CANative]

The base cost of a new MH at good quality is about $55/sf (FTR... cost is not based on actual costs but rather on sales information.) Add in components and extras and you're up to maybe $80 to $110/sf. A finished garage can be $20k...it's in the range. I was just making up a number to demonstrate the fact that the site location plays a part in market value.